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Technology Stocks : IBM -- Ignore unavailable to you. Want to Upgrade?

To: Robert Scott Diver who wrote (6095)	1/12/2000 9:21:00 AM
From: pvz	Read Replies (1) \| Respond to of 8220

According to my calculations, IBM's PE averaged between 12 and 15 from 1994 to 1997, when it started climbing. I don't think it's relevant to use SUNW's PEG as a basis for calculating IBM's target price. While SUNW also traded at much lower PE's in the past, there are 2 significant differences: SUNW has always had a much steeper growth curve, and it's also a much smaller company, with more room to grow. Much as I like IBM, and it's my largest holding, I continue to worry about its ability to justify a PE of 28 and above when earnings are only growing at 10 to 15% annually. Also, the company is so large that it will take another couple of years before earnings from the growth side eg services eclipse the mature hardware side of the business.